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what it is
McGraw Hill sells curriculum, digital courseware, and professional learning tools to schools, colleges, and workers in the U.S. and overseas.
how it gets paid
Last year Mcgraw Hill made $2.0B in revenue.
what just happened
The latest verified quarter showed $1.6B of revenue and $0.47 EPS, but Yahoo's last-earnings feed says MH missed.
At a glance
B+ balance sheet — decent shape, but not bulletproof
9.9x trailing p/e — the market's not buying it — or you found a deal
14.0% return on capital — nothing to write home about
$1.75 fy2026 eps est
$2B fy2028 rev est
xvary composite: 55/100 — below average
What they do
McGraw Hill sells curriculum, digital courseware, and professional learning tools to schools, colleges, and workers in the U.S. and overseas.
Gross margin → money left after direct costs → pricing power. McGraw Hill posted an 80.1% gross margin in the latest quarter, which says schools still pay for its content. If your assignments, tests, and course setup live inside one system, switching is a semester-sized headache.
How they make money
$2.0B
annual revenue
total revenue
$2.0B
n/a
The products that matter
digital higher education platform
Evergreen Platform
inside a $1.2B segment
it drives 70% of higher education revenue inside McGraw Hill's $1.2B largest segment, which is why adoption here matters more than textbook nostalgia.
70% adoption
primary education curriculum software
K-12 Digital Curriculum
$0.6B segment · -3%
this business sits inside a $0.6B segment that declined 3%, so strong product positioning does not help much if district buying cycles get smaller.
market pressure
workforce training and upskilling
Professional Learning
$0.2B segment · +15%
it is only 10% of revenue today, but a 15% growth rate makes it one of the cleaner expansion pockets in a business still proving its transition story.
faster growth
Key numbers
$2.8B
long-term debt
That debt equals 47% of capital, so balance-sheet pressure is part of the stock story whether you like it or not.
9.9x
trailing p/e
P/E → price-to-earnings ratio → how much you pay for each dollar of profit. Under 10x is cheap if the earnings hold.
26.0%
operating margin
Operating margin → profit left after running the business → room for error. At 26.0%, this is still a solid business underneath the leverage.
14.0%
return on capital
Return on capital → profit earned on money invested in the business → a quality check. At 14.0%, McGraw Hill clears the 'decent business' bar.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- long-term debt $2.8B (47% of capital)
- net profit margin 16.0% — keeps 16 cents of every dollar in revenue
- return on equity 54% — $0.54 profit for every $1 investors have put in
B+ — net profit margin looks solid but long-term debt needs watching.
Total return vs. market
Return history isn't available for MH right now.
source: institutional data · return history unavailable
What just happened
missed estimates
The latest verified quarter showed $1.6B of revenue and $0.47 EPS, but Yahoo's last-earnings feed says MH missed.
EDGAR-backed data shows revenue up 278% vs. prior year and EPS up 527%, with 80.1% gross margin. Yahoo Finance, however, lists the last earnings as -$0.11 versus a $0.15 estimate, so the public data set is inconsistent and needs the next report to clean it up.
$1.6B
revenue
$0.47
eps
80.1%
gross margin
the number that mattered
80.1% gross margin matters most because gross margin (sales left after production costs → pricing power and content economics → proof the library still earns like software).
-
mcgraw hill delivered lackluster fiscal second-quarter results. (year ends march 31st.) the global education information solutions company posted net income of $105.3 million on total revenues of $669.2 million, declines of 21% and 3%, respectively, against the pro forma fiscal 2024 second-quarter tally.this primarily reflects the anticipated smaller k-12 education market for the 2025-2026 school year, partially offset by strong growth in the higher education segment. the company is transitioning from a traditional textbook publisher to a digital-first education technology and learning-solutions provider. this is being aided by expanding subscription and personalized learning offerings that tap into long-term secular demand for digital education tools. digital programs now account for a majority of the mcgraw hill's revenue, and the shift toward adaptive learning platforms and ai-enhanced tools should continue to expand its addressable market across k-12, higher education, and professional learning. mcgraw hill's large installed base, with products used in the vast majority of u.s. school districts and colleges, provides a strong foundation for deeper penetration of digital workflows and personalized learning experiences.
-
mcgraw hill's long-term growth prospects remain favorable.the company's deep, established institutional relationships and product innovations support its ability to expand its customer base. additionally, mcgraw hill's land-and-expand strategy should enable it to drive incremental revenue from existing customers though up-selling and cross-selling. as learners and educators continue to benefit from its products, mcgraw hill ought to see increased adoption and activation of new solutions that address evolving needs and extend the value it offers.
-
this equity is unranked for timeliness due to limited trading.
-
longer term, investors may want to wait for a better entry point.
-
mcgraw hill shares have risen roughly 40% since our october report, which has muted the equity's capital appreciation potential out to 2028-2030.
source: company earnings report, 2026
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What could go wrong
the #1 risk is a smaller 2025–2026 K-12 purchasing cycle.
high
K-12 market contraction
K-12 Education is a $0.6B segment, or 30% of revenue, and it declined 3%. That drag already showed up in results.
If district spending stays weak, digital growth elsewhere can keep looking good while total company growth stays muted.
med
digital transition stalls at the corporate level
Digital revenue grew 11% last quarter, but total revenue was flat at $434.2M. The math only works if digital keeps outrunning print erosion.
If digital growth slips below the decline in legacy demand, the 9.9x multiple may be a value trap instead of a bargain.
med
debt limits strategic flexibility
Long-term debt stands at $2.8B, or 47% of capital. That is manageable today, but it matters more if growth stays sluggish.
A slow-growth business carrying this much debt gets less room for mistakes, acquisitions, or aggressive reinvestment.
low
new CEO, new script
A new CEO took over in February 2026. Fresh strategy can help, but it also resets expectations around product priorities and execution tempo.
If early messaging turns into a buzzword parade instead of measurable growth, investor patience gets thinner fast.
A 3% decline in a 30%-of-revenue segment was enough to keep company-wide revenue flat at $434.2M even with 11% digital growth. That is the risk in one line.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
q4 2026 earnings report
Expected around june 3, 2026. You want to see whether raised guidance holds and whether total revenue finally moves off flat.
metric
digital growth above 10%
11% digital growth is good. It needs to stay there, or better, if the market is going to treat MH like a transition winner.
risk
k-12 demand for the 2025–2026 cycle
The K-12 segment is $0.6B of revenue. If that market keeps shrinking, the rest of the portfolio has to work harder just to keep reported sales steady.
trend
recurring revenue mix
Recurring revenue is already 63%. If that number keeps rising while margins stay high, the market has a cleaner case to rerate the business.
Analyst rankings
timeliness
unranked
Limited trading and coverage mean there is no clean short-term rank. In human-speak: the street is not giving you much consensus to lean on.
risk rank
3
This sits around the middle of the risk scale. Safer than the hairiest stocks. Not a bunker.
xvary composite
55 / 100
Below average overall. The stock looks optically cheap, but the operating proof has not caught up enough for a higher score.
source: institutional data
Institutional activity
82 buyers vs. 0 sellers in 3q2025. total institutional holdings: 0.2B shares.
source: institutional data
Price targets
3-5 year target range
$20
$30
$17
current price
$25
target midpoint · +49% from current · 3-5yr high: $30 (+80% · 15% ann'l return)
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